You are considering a project X which has cash flows given below:

$$ Year $0$ Year $1$ Year $2$

$$ Project X$($$$7,000)$ $$40,000($$$40,000)$

Project X has two IRRs, and its cost of capital is $15\%.$ Which of the following statements best describes Project X$?($Hint: draw NPV profile$)$

No matter what its cost of capital is$,$ it should be rejected.

No matter what its cost of capital is$,$ it should be accepted.

If the cost of capital would be between the two IRRs, it could be accepted.

All of these statements are not consistent with Project X$.$

Since both IRRs are greater than its cost of capital, it should be accepted.